In the app store wars, China Mobile’s Mobile Market has a big advantage over other operator-run app stores: In a country where two-thirds of smartphones run the Android OS, it doesn’t have to fight with Google and its Google Play store for consumer mindshare.
Citing censorship concerns, Google in 2010 closed down its local search service and does not offer Google Play in the country. And that leaves China Mobile’s Mobile Market as the primary source for all things Google.
Bloomberg reports the operator’s store has 158 million registered users who combined have downloaded more than 630 million apps, making Mobile Market the largest operator-run app store in the world. While Apple does offer a storefront in China, iPhone sales account for just 5.7 percent of smartphone sales in the country, while Android accounts for 68 percent. Consequently, China Mobile’s sales from applications and information services grew 12 percent to 48.4 billion yuan last year, overtaking text messaging as the operator’s biggest source of revenue.
Yankee Group Senior Analyst Jason Armitage comments
“Mobile players are eyeing the burgeoning opportunities in China with interest. And no wonder: a mobile market adding close to 30 million lines a quarter represents stellar potential. Who will benefit most from this goldmine? As China Mobile’s apps success indicates, state-owned domestic players are in the pole position. Non-domestic developers with overseas ambitions hit a wall when it comes to China. Piracy and the requirement for Chinese partners are just the start of a painful process to generate meaningful revenues. Operating conditions are unlikely to change. Companies therefore have to be prepared for heavy and sustained investment—or switch focus to alternative high-growth markets.”
